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Deep in the bowels of Hewlett-Packard's financial department, the person in charge of the company's checkbook has writer's cramp. The hardware maker has announced today the proposed purchase of not one, but two companies.

Grabbing the spotlight is HP's $1.6bn bid on data center software company Opsware, followed by the somewhat overshadowed $241m bid on thin-client vendor Neoware.

HP bids $1.6bn for Opsware

Hewlett-Packard plans to strengthen its software arm by reaching down, lifting out its massive wallet and removing $1.6bn to purchase software company, Opsware.

HP will pay $14.25 per share of Opsware, a 39 per cent premium from the closing price of $10.28 on Friday. The deal is expected to close by the end of HP's fourth quarter in October.

Opsware was co-founded by internet entrepreneur Marc Andreesen, who in a previous life co-founded the usurped web browser company, Netscape. His latest venture makes software for automating data center administration tasks, such as the booting of operating systems and applications from bare metal to a running stack. The Opsware code can also reconfigure servers and apply patches to applications.

According to Andreesen's blog, there are 550 employees on the Opsware payroll. The company has more than 350 customers including Goldman Sachs, JP Morgan, Microsoft, Comcast, Tivo and the US Department of Defense.

Opsware was founded in 1999 as Loudcloud, which focused on internet hosting management. When the business got stale, the company sold the operations-side of the business to service provider Electronic Data Systems. Loudcloud was retooled, then reborn as Opsware.

The company's CEO Ben Horowitz is full of piss and vinegar about the deal. "We are about to see one of the biggest application and infrastructure build-outs in history. The addition to Opsware to the HP Software portfolio will make HP the obvious choice for powering the next generation of data centers to come."

Whether or not the acquisition will truly be forever scorched into the pages of history, destined to be recanted by generations of school children or relived through the strumming of wandering bards and masterful storytellers remains in the air, frankly. But the move does follow the trend of hardware vendors such as HP and IBM expanding into the more lucrative software market to appeal to data center managers and company stockholders. HP said the bid follows last year's $4.5bn purchase of Mercury Interactive in its software-strengthening strategy.

Opsware will be absorbed into HP's software business after the deal closes. HP said it will appoint Horowitz to lead its Business Technology Optimization organization, reporting to Thomas Hogan, the senior veep of HP Software.

Ayche Pea purchases Neoware for $214m

HP has also signed the check today to acquire thin-client specialist Neoware for $214m. The company will be purchased at the price of $16.24 per share, approximately a 7 per cent premium to Neoware's closing price of $15.24 on Friday.

The deal will add Neoware's Linux thin-client software to HP's virtualization stable, which is currently based on Windows XP Embedded and Windows CE. The company is playing the ol' green computing chestnut, touting the technology as an effort to reduce its environmental footprint through reduced noise, power and packaging versus desktop PCs.

"Our objective is to become the preferred brand of thin-clients and software for virtualized client computing," said HP exec Kevin Frost in a statement. "Thin clients are an important component in today's overall computing strategy and play a critical role in HP's virtualization strategy. Acquiring Neoware confirms our commitment to thin-client computing and client virtualization solutions."

HP already sells a number of thin client and blade PC products.

The sale is expected to close in the company's fourth quarter of this calendar year. When that happens, Neoware will be integrated into the Business Desktop Unit of HP's Personal Systems Group. ®